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JobKeeper program ‘lifeline’ for most small business owners

The government’s JobKeeper program has been a lifeline for small businesses, with 84% of small business owners that were eligible for the JobKeeper program reporting that the subsidy allowed them to continue trading, according to new research released by MYOB.

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Australian small business owners believe that the government has done a good job, with 71% saying the Australian government response is better than that of the United States, and 68% says it is better than the United Kingdom.

However, four in ten business owners say their business is in hibernation for six months, with a further 24% reporting that their business has or will need to permanently shut down. In addition, 68% of small business owners say that their revenue is down due to the impact of COVID-19 and 26% expect the consequences to last for at least one to two years.

The COVID-19 Edition of MYOB’s Business Monitor surveyed more than 1,000 Australian SMEs between April and May. It highlights the impact COVID-19 has had on small businesses around Australia and across industries including financial, agriculture, trades, transport, retail and hospitality.

“The impact of COVID on the small business sector is hard to overstate, as evidenced by the data,” MYOB economist Jon Manning said.

“Some small business owners believe their recovery will take only a few months while others are expecting it to take years. 93% small business owners have told us they have seen a reduction in work due to the pandemic. Over the next three to six months 52% of respondents say they expect their revenue to decrease by 20% or more.

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“When it comes to projecting how businesses will come out of the pandemic, the outlook is split based on demographics and by industry. By industry we can see 35% of transport, postal and warehousing industry believe the disruption will impact their business for up to 6 months’ time whereas 24% of the retail and hospitality industry believe it will take between one and two years for their business to bounce back.”

Manning said supporting contactless payments will help businesses bounce back faster as it  will speed up the circulation of money through the economy, improving cash flow along the way and the bigger the transaction value, the bigger the benefit.

“As life gets back to normal and Australia starts to rebuild the economy, the shape of the recovery will differ from industry to industry. If the velocity by which money electronically changes hands from buyer to seller gathers pace and bigger transactions are possible there is no doubt the economic recovery will speed up too,” he said.

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